The Directorate of Enforcement (ED), Mumbai Zonal Office-II, conducted search operations at nine locations in Maharashtra’s Yavatmal district under the Prevention of Money Laundering Act (PMLA), 2002, in connection with an alleged Rs 242-crore fraud involving Babaji Date Mahila Sahakari Bank Ltd.
The investigation follows multiple FIRs registered by Avdhutwadi Police Station against bank officials, employees and borrowers. The bank’s licence was cancelled by the RBI in 2022.
A state-ordered special audit reportedly found that the bank’s CEO, Chairperson/Chairman, directors and officials, allegedly in connivance with borrowers, valuers and auditors, sanctioned loans without adequate collateral or assessment of repayment capacity.
The loan funds were subsequently diverted through cash withdrawals, loan evergreening, personal use and alleged kickbacks.
The probe also found that dummy loan accounts were created using existing borrowers’ credentials, while property valuations were allegedly manipulated to siphon off funds.
During the searches, ED seized incriminating documents, including numerous property papers. The investigating agency said a wider nexus between bank officials and borrowers had emerged. Further investigation is underway.
